Retail's Great Equalizer in 2018? Big Data
Imagine a store where many of the customers are invisible. Sounds like an episode of the "Twilight Zone" or a Stephen King novel. Yet the scene is a good analogy for what many traditional retailers and brands experience with their digital platforms — they have limited to no visibility as to who their customers are.
The irony is that retailers and brands have access to enormous amounts of data from websites, mobile apps, CRMs, social media streams, loyalty programs and point-of-sale systems. Yet the data is often scattered across various silos, making it challenging to have full visibility into it and derive actionable insights from it. Even worse, the data may lead to campaigns that ultimately confuse or even annoy customers because the information is faulty or out of context.
Add this fragmentation of data to another issue plaguing retailers: walled gardens. Walled gardens such as social networks and large e-commerce sites generally control their own data sets. These entities leverage this data much to their own marketing and sales benefit, putting brands and retailers at a big disadvantage.
What can be done? The good news is that retailers and brands have the tools to fight back and thrive. Big data has the potential to be the great equalizer in a time of transformation, where marketers are battling for consumers’ share of time, attention and wallet. But marketers must break from traditional approaches and reframe their strategies.
So let’s take a look at three steps to get on the right track
Make Big Data a Priority
Data must be viewed as a strategic asset. Think of it as something that should be listed on a company’s balance sheet, along important items like cash, real estate and equipment. It’s that critical. The good news is that more and more marketers are realizing this. In a recent study of 500 global marketing executives, four out of five marketers flagged customer data as a key part of their “business strategy.”
Once the importance of data has been elevated, next a clearly defined and fully developed data strategy is in order. This needs to cover important considerations like warehousing, data architecture, governance and compliance. There must also be a focus on data quality. For example, in the same aforementioned study, the biggest issue marketers face with customer data is “ensuring quality data.”
Leverage Data Collaboration
As retailers and brands look for creative ways to better compete with physical-digital giants, many are turning to pooling data. In fact, a recent study showed that three-fifths of marketers surveyed already are part of a data cooperative, and seven out of 10 are satisfied with their collaborations. Pooling data assets among various organizations is likely to improve personalization and return on investment. Now this strategy may seem risky. Some retailers and brands will understandably fear the sharing of data for competitive reasons. There are also the nagging concerns about privacy and potential data breaches.
Yet such issues are overblown. So long as there are compliance measures put in place and that data is anonymized, the collaboration efforts should be safe and effective. Besides, the goal is ultimately about putting the shopper at the center.
Using the Right Data at the Right Time
It’s impressive to have terabytes of data, but unless you’re leveraging it to connect the dots, it’s really meaningless. To win the data wars, a company needs to use granular data. This means using information about purchase intent — at the moment — to connect shoppers with relevant experiences. This could be by the time of day, season, or the kinds of sites or apps the person is using. Essentially, the data must be fresh.
E-commerce and retail leaders that have become data mining experts, relying on troves of customer data to cross-sell and drive profits, are winning the retail race. For others to compete, they must start following suit and push their data strategy to the forefront.
Retailers and brands that advance and create a coherent data strategy, leveraging collaboration and personalization focused on the buyer journey will have a better chance at thriving. By combining all this with offline assets, the impact can be quite powerful. In other words, customers will no longer be invisible and there will be a clear path to growth again.
Greg Archibald is the executive vice president, Americas, for Criteo, a personalized retargeting company.
